The 10 Best Housing Markets For Buyers Across the U.S. in 2023

Understanding the Best Housing Markets in the U.S.

Slowing home sales and price growth continue to shift the market in the direction of buyers. The nation's 100 largest housing markets continue to move in the direction of favoring buyers, according to the latest data from the Knock Buyer-Seller Market Index.

At the start of 2023, 13 markets were firmly in buyers’ territory, 43 were in neutral territory and 44 favored sellers. Although sellers’ markets far outnumber buyers', the environment has shifted dramatically over the past 12 months from when all 100 of the largest housing markets favored sellers. All but one market – Fayetteville, N.C., – moved at least marginally toward favoring buyers during 2022. With the typical home staying on the market for just 10 days and only half a month of housing supply - each among the lowest such measures in the country - Fayetteville continues to rank as the nation’s No. 1 market for sellers.

After shifting more dramatically toward buyers than any other metro in 2022, Phoenix continued its reign as the top buyers’ market in December.  The typical Phoenix home sold for 3% less than the asking price in December, one of the best ratios for buyers.(The top 15 buyers’ and sellers’ market rankings and key market stats for December 2022 can be found in the Appendix at the end of the report.)

According to the Index, which analyzes six key housing market metrics to measure the degree to which the nation’s 100 largest markets favor home buyers or sellers, median days on the market rose in nearly all markets in December, as inventory growth outpaced home sales year-over-year. Despite a slight increase in home prices (+0.7%) from December 2021, homes sold at a lower price than the asking price in all but six of the 100 largest markets – Buffalo-Cheektowaga, N.Y.;  Hartford-East Hartford-Middletown, Conn.; New Haven-Milford, Conn.; Rochester, N.Y.; Springfield, Mass. and Syracuse, N.Y.

Across the U.S., home prices continue to hold up well with median sale prices declining in just 26 markets year over year, with the remainder of the 100 largest markets seeing prices continuing to rise or remaining unchanged. On average across the 100 largest housing markets, homes sold for 2% less than the asking price, compared to December 2021 when the average sale price equaled the average list price. 

Key Metrics

As home sales slowed and days on markets increased, 81 of the 100 largest markets saw inventory increases in December 2022. At year-end, there were a total of 354,000 homes for sale in the nation’s largest markets, up 32.1% year over year. Based on the Index forecast, the number of homes available for sale is expected to continue to increase through 2023, rising 17% by year-end. 

While good news for shoppers who have faced a limited supply of homes to choose from in nearly every market throughout the country, the increase will be marginal at best, and not felt across the country. At year-end 2022, inventory in the 100 largest markets was 42% lower than in December 2019. Fifty markets are expected to see further inventory declines over the next 12 months, with Raleigh, N.C. (-49.2%); Austin, Texas (-46.9%); Baltimore (-46.5%); Reno, Nev. (-45.8%) and Richmond, Va. (-45.4%) forecast to see the largest decreases.

Cities with the Best Buyers Market in the U.S.

With a lack of homes available for sale expected to continue to be a challenge for the foreseeable future, we used the Knock Buyer-Seller Market Index to identify the markets where buyers are likely to have more options.

The top 10 markets likely to see the biggest gains in for-sale homes in 2023 in rank order are:
1. Salt Lake City, UT
2. Dallas, TX
3. Denver, CO
4. Charlotte, NC
5. Memphis, TN
6. Las Vegas, NV
7. Charleston, SC
8. Colorado Springs, CO
9. St. Louis, MO
10. New Orleans, LA

Inventory in these markets is forecast to increase throughout 2023, peaking in September, October and November. This means buyers with the flexibility to wait until the fall will see more buying options.

Like the rest of the country, inventory in the Top 10 markets dropped during the pandemic. However, they did not see the same massive declines as the rest of the nation. In the three markets where inventory is expected to grow the most - Salt Lake City, Dallas and Denver - inventory declined by approximately 20%, 34% and 20%, respectively, between December 2019 and December 2022, compared with 42% elsewhere.

How Low Inventory Has Impacted the Top Buyers Markets

Although the low housing inventory has led to record-high home prices over the past several years, in 2023 inventory growth won't necessarily translate into home price declines. Only three of the markets on Knock’s list of the top 10 markets for buyers to find a home – Salt Lake City, Las Vegas and New Orleans – are forecast to see price declines over the next 12 months. The remainder are projected to see home prices remain flat or grow marginally with median home price in St. Louis home forecast to increase nearly 10% year-over-year. 

In addition, buyers will still need to act relatively quickly with days on market expected to decrease in Charlotte, N.C., Memphis, Tenn. and New Orleans. Colorado Springs, Colo., will see the largest increase in days on market with a forecasted increase of 37 days to 67.

Of the top 10 markets, only three – Colorado Springs, Colo.; Dallas and Las Vegas – currently favor buyers. The remainder are in neutral territory with the exception of St. Louis, currently ranks as a sellers’ market. All but St. Louis are forecast to move into buyers' territory during the second half of 2023.

Markets with the largest expected inventory gains

Buyers Expected to Create A Window For Sellers

The U.S. housing market is expected to hover in neutral territory – not favoring buyers or sellers – over the next few months. It will gain seasonal momentum toward sellers in the spring and then move firmly into buyers' market territory by summer and continue to trend in the direction of buyers through the end of the year.

By December 2023, 34 markets are forecast to be buyers' markets (up from 13 in December 2022), 34 markets will remain sellers’ markets (down from 44) and 32 will be neutral. 

Home price growth is expected to slow from the double-digit gains the U.S. housing market racked up over the past several years. However, home shoppers will not see significant price declines in a majority of the 100 largest housing markets. Rather, prices will decline, mostly by small amounts, in just 16 large markets over the next 12 months. In contrast, 20 markets are forecast to see median sale price increases of at least 10% during the same time frame.

Home prices are forecast to peak at $366,000 by June 2023 - well below the record-breaking annual median sale price peak of $410,000 set in April, May and June 2022. By December 2023, the median price is forecast to reach $351,000, a 4% decline from the December 2022 median price of $365,000.

As the market continues to cool, home sales are forecast to decline by 10.5% year over year, with the number of sales dropping in 75 markets. Median days on market are forecast to continue to rise through December 2023, when a typical home is expected to sell in 52 days - the longest of any time since January 2017. In Raleigh, N.C. and Greeley, Colo., median days on market will reach 130 and 104 days, respectively, the highest of any market and more than double the national median. 

Months’ supply is expected to peak in June at 3.1 months, before declining to 2.7 at year-end.

The sale-to-ask price ratio is forecast to remain the same through spring, with average sales hovering between 2% and 3% below the typical asking price. Starting in August, the ratio will begin to decline, ending 2023 down 4%, the lowest since January 2017, the beginning of Knock’s Buyer-Seller Market Index.

Top 15 buyers' markets in 2023

Top 15 sellers' markets in 2023

All 100 markets buyer-seller market status

Buyer-Seller Market Index methodology

The Buyer-Seller Market Index was developed by Knock to measure the degree to which the nation's largest, most active housing markets favor home sellers or home buyers. It combines six measures of the housing market, covering six years of monthly data between January 2017 and December 2022.

By observing trends in these measures in major U.S. cities, the Index can forecast housing market conditions 12 months from now, helping homeowners, prospective home buyers and property investors make more educated decisions in the U.S. housing market. 

The Index uses data on more than 150 million properties in the nation's 100 largest metro areas in terms of total home sales from the last six years. The data was obtained from housing database The Multiple Listing Service, using the National Association of Realtors' Real Estate Transaction Standards (RETS) API. 

Index values range from -4 to 4, with lower negative values indicating a relatively favorable market for buyers and higher positive values indicating a relatively favorable market for sellers. Index values ranging around zero denote a somewhat neutral market. Data is not seasonally adjusted. 

The six equally-weighted measures for the nation's top 100 markets (metros) each represent six years of monthly data:

1. Average sale-to-ask price ratio – Calculation: Average of each sale price / list price ratio. 

2. Homes Sold – Number of homes sold.

3. Inventory – Number of active listings.

4. Median Days on Market – Median number of days between when a property is listed and when it is taken off the market. Median days on market data is not available for seven of the 100 largest markets (Boise, Idaho; Richmond, Va.; Seattle; Allentown, Pa.; Portland, Maine; New Haven, Conn.; and Bridgeport, Conn.)

5. Median Sale Price – Middle of the sale price distribution.

6. Months' Supply – Calculation: # active listings / Months' supply uses a six-month moving average inventory estimate as its denominator beginning June 2017.

Appendix

15 top buyers' markets December 2022

15 top sellers' markets December 2022